The country's top executives see dark days ahead

February 23, 2009

23 February 2009

The country's top executives see dark days ahead

This article is excerpted from the 22 February 2009 edition of “globeandmail.com”.

Canadian executives are digging in for a prolonged economic siege by trimming their spending, hiring and marketing as they brace for a recession that could be long and deep.

The latest quarterly C-Suite survey reveals a growing pessimism about the economy, and shows that executives now feel the initial measures they've taken may not be enough to deal with the deepening downturn.

The survey was conducted in late January and early February for Report on Business and Business News Network by the Gandalf Group. Top executives from 150 companies responded.

Those in the corner office are more negative about the economy than they were just three months earlier. Now almost 90 per cent expect the economy to decline, either moderately or strongly, in the next 12 months. Half think it will be more than a year before growth returns.

As a result, almost 40 per cent of those surveyed said their companies will be cutting staff levels in the next year….

… While those surveyed expressed an almost unanimous confidence that their own company will be able to weather the recession, more than 80 per cent say this is the worst downturn they've seen in their years in business.

Two-thirds say the economy has forced them to focus on the short-term at the expense of long-term growth plans, and half are more concerned about corporate survival than they were six months ago. …

Still, there is a sense of optimism – at least in the long term….

Indeed, of the C-Suite respondents, almost two-thirds said it is now even more difficult to access credit than it was three months ago – when it seemed tougher than ever.

At the top of the list of actions executives say they are considering to deal with this environment is cutting capital spending. Eighty per cent said they are now more likely to make this move in light of current conditions.

More than half say they are more likely to look at trimming marketing costs, while 35 per cent may trim back research and development. About 16 per cent say they're more likely to consider seeking creditor protection, because of the downturn….

C-Suite executives generally expressed positive opinions about the recent federal budget, and its stimulus measures, with about 60 per cent saying they viewed it favourably.

Infrastructure spending, the boost for lending programs, and an extension of the capital-cost allowance for manufacturers, were looked at in the best light.

Still, some executives feel the government's actions will not be the crucial factor in getting Canada out of recession. …


Topic(s): 
Canadian Economy & Politics
Information Source: 
Canadian News Channel
Document Type: 
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